The Future of Dealer Networks in an Electric Era

The industry is undergoing an unprecedented transformation, and at the heart of this shift is the rise of electric vehicles (EVs).

With battery technology still evolving and supply chains facing complex challenges, the role of dealer networks is being redefined. Robin Brundle, chairman of Recyclus Group, offers his expert insights into the industry’s trajectory, highlighting the challenges and opportunities ahead.

Wolverhampton-based Recyclus was founded by Brundle and Alex Stanbury, the latter a seasoned corporate finance specialist with over 15 years of experience in the natural resource sector.

Automotive retail veterans will already know of Robin Brundle as the one-time managing director of the family-owned franchised dealer group Brundles which was sold in 2006.

The Changing Role of Dealer Networks

Two decades on, Brundle explains that, despite changing market conditions, the fundamental cost structure of dealerships remains under pressure with manufacturers still maintaining strict control over the profitability of their franchised dealer networks.

“Manufacturers have always had a limit on how much profit they want dealers to make,” Brundle states. “That said, I still believe dealer networks have a future. However, the way vehicles reach the market is shifting due to the pressures of EV development.”

With EV battery chemistry and architecture still in flux, supply chains remain fragmented, preventing manufacturers from achieving significant cost reductions. This financial strain is felt across the entire industry, including dealership networks.

“OEMs face financial challenges, and when that happens, they examine all cost lines, including dealer networks. The traditional dealership model is costly, and in challenging times, OEMs have to rethink their strategies,” Brundle notes.

He believes that dealer networks will continue to play a crucial role, particularly in balancing supply and demand. While agency models may work when demand outpaces supply, traditional dealerships remain essential when there is surplus inventory.

“There’s still a generational divide too - many buyers still want a physical presence and human interaction. That’s why the industry has seen mixed results when shifting to online sales models.”

The Manufacturing Conundrum

The push for cost reduction has always been a driving force in the industry. However, the lack of standardisation in battery technology has disrupted traditional cost-saving mechanisms.

“The industry thrives on maximising commonality across brands. Typically, manufacturers collaborate behind the scenes to reduce costs through bulk purchasing,” Brundle explains. “But since the technology race for EVs is ongoing, we haven’t reached the stage where common supply chains can be fully leveraged. It may take another three to seven years before we see true standardisation in battery architecture and chemistry.”

He suspects collaboration between manufacturers is more common than consumers realise and suggests that brand competition is often more of a marketing narrative than an operational reality.

“If multiple brands have limited production runs, why wouldn’t they share a common battery skateboard platform and differentiate only in styling? That’s the logical next step,” he says.

Supply Chain Struggles and Geopolitics

The global supply chain for EVs is fraught with economic and political challenges exacerbated by China’s dominant position in the EV battery market.

“Most roads in the supply chain lead to and from China. They’ve been strategically building this dominance for over 30 years. They’ve invested heavily in all battery chemistries and secured mining rights worldwide,” he explains. China’s control over raw materials has created an uneven playing field, making it difficult for new market entrants to compete.

“Recently, they have been suppressing commodity prices to deter competition. This is particularly concerning because, according to an Australian government minerals report, by 2026, demand for key materials like aluminium and copper will exceed supply.”

Brundle warns that current trade tensions and the threat of tariffs could further complicate the industry’s future.

“Tariffs may not be the best long-term solution. If we look back to the 70s and 80s, Japan’s automotive dominance led to restrictions on imports to maintain a 10% market share in the UK. That worked then, but applying a similar approach to China requires careful consideration due to its economic scale.”

Consolidation and Specialisation

With economic pressures mounting, Brundle sees consolidation as inevitable. “Dealer groups will need to be turning over billions to remain viable long-term. Smaller groups will have to merge to survive.”

Even so, dealers will still need to cater for a diverse customer base.

“Car makers must cater to multiple generations of buyers - some prefer traditional showrooms, while younger consumers prioritise vehicle connectivity over design and performance.”

He reckons that connectivity presents a new opportunity for dealerships. “Many consumers don’t yet understand the full potential of connectivity. Some dealerships may view it as blue-sky thinking, but over time, it will become a core component of customer engagement and aftersales.”

Range Anxiety, Charging Solutions

One of the biggest obstacles to EV adoption remains range anxiety. Brundle acknowledges that the industry underestimated consumer expectations.

“The average UK journey is around only 81 miles per day, so a 260-mile range EV should be more than enough if home charging is available. But drivers are used to getting 400–600 miles per tank and it is that perception gap has slowed adoption.”

With some manufacturers now introducing advanced EVs with 450-mile ranges, Brundle believes consumer confidence will increase, ultimately driving standardisation and consolidation in EV manufacturing.

Induction charging, he suggests, could also be a game-changer. “Wireless charging, where you drive over a plate instead of plugging in, has been explored for years. If implemented on a large scale, it could remove barriers to adoption.”

He envisions a future where induction charging is integrated into public spaces, street parking, and even traffic lights. “Governments and OEMs need to push for these advances, as they would eliminate the hassle of cables and compatibility concerns.”

Dealership Survival Strategies

Looking ahead, Brundle advises dealerships to embrace the EV revolution wholeheartedly. “My advice is to get into EVs as quickly and as enthusiastically as possible. Own the space, learn everything about the lifecycle of EV batteries, and become an expert.”

Training will be critical, as handling high-voltage batteries requires specialised knowledge. “Investing in training is crucial because handling high-voltage batteries is not for the faint-hearted. Dealerships that position themselves as EV specialists can build a strong local reputation.”

For medium-sized dealerships, specialisation could be the key to survival. “They may not invest in charging infrastructure, but they can become the go-to local experts for EV maintenance and repair and it is this expertise that will be critical for survival.”

As the automotive industry transitions to electric vehicles (EVs), dealerships will also need to manage the influx of used, damaged, and end-of-life lithium-ion batteries. Unlike traditional lead-acid batteries, EV batteries are significantly larger, heavier, and pose unique safety risks if not handled correctly.

Circular Principles

Recyclus Group was founded with a vision of creating a circular economy for battery minerals. While its parent company, Technology Minerals, focuses on ethically sourcing raw materials, Recyclus specializes in ‘urban mining’ - the process of extracting valuable materials from used batteries for reuse in new production.

With the growing number of EVs on the road, Recyclus is working initially to scale its Wolverhampton operations, ensuring a sustainable and efficient solution for battery disposal.

"We began processing lithium-ion batteries in July 2023, and while we are still in the early stages, we expect to be handling 7,000 to 8,000 tonnes this year alone," Brundle explains. "With further growth, we aim to process up to 22,000 tonnes annually, making us a key player in the UK’s battery recycling infrastructure."

According to Brundle, dealerships must rethink their approach to handling used EV batteries. Unlike traditional vehicle components, which can be easily returned to manufacturers or disposed of, EV batteries require specialised containment and logistics solutions.

Safety and Compliance

To minimise risks and remain compliant with industry regulations, dealerships must adopt best practices for battery storage, transportation, and disposal. Here, Brundle ecommends:

• investing in safe storage solutions – using fire-resistant containment systems like the Recyclus ‘Live Box’ can prevent catastrophic losses in the event of a battery fire.
• implementing clear handling protocols – employees must be trained in the safe movement and disposal of EV batteries.
• partnering with certified recycling facilities – ensuring that end-of-life batteries are processed by reputable recyclers to guarantee regulatory compliance and environmental responsibility.
• obtaining end-of-life certificates – to avoid liability, dealerships should require official documentation proving that batteries have been disposed of properly.

Brundle’s final message is clear: "The transition to EVs is inevitable, but it comes with new challenges. Dealerships that prepare now - by implementing safe storage, responsible disposal, and compliance protocols - will be better equipped for the future. Recycling isn’t just an environmental necessity; it’s a business imperative."

As Brundle puts it, “The future belongs to those who are prepared to embrace change and become experts in this new era of mobility.”